King Charles inherited wealth and left his own empire

LONDON – King Charles III built his own empire long before his mother’s inheritance.

Charles, who Officially crowned the UK on Saturday, has spent half a century turning his royal estate into a multi-billion dollar portfolio and is one of the biggest moneymakers in the royal family business.

While his mother, Queen Elizabeth II, given the bulk of responsibility for his portfolio, Charles became much more involved in the private property development known as the Principality of Cornwall. Over the past decade, he has assembled a large group of professional managers who have increased the value and return of his portfolio by about 50%.

Today, the Principality of Cornwall owns the famous cricket ground known as The Oval, lush farmland in the south of England, seaside holiday rentals, office space in London and supermarket warehouses in suburban. (The principality is a territory traditionally administered by a duke or duchess.) The 130,000-acre property portfolio is roughly the size of Chicago and generates millions of dollars in rental income each year.

Its shares are worth about $1.4 billion, compared with about $949 million in the late queen’s private portfolio. These two estates represent an estimated fraction of the royal family $28 billion in assets. Above all, the family’s personal possessions remained a closely guarded secret.

As king, Charles will take over his mother’s portfolio and inherit a portion of this untold personal fortune. While British citizens typically pay an inheritance tax of around 40%, King Charles is exempt from this tax. And he would pass control of his principality to his eldest son, William, for further development without paying corporate taxes.

The rise in the royal family’s fortunes and King Charles’ personal fortune over the past decade comes at a time when Britain faces profound austerity budget cuts. Poverty level skyrocketed and the use of food banks almost doubled. His lavish lifestyle and polo has long sparked accusations that he has no contact with ordinary people. And he was at times the inadvertent symbol of that disconnect – like when his limo being hit by a crowd of students opposed the tuition increase in 2010 or when he sitting on top of the throne This year’s royal pledge to help families in need.

Today, he is crowned as the country faces a cost of living crisis expected to see poverty even worse. As a more divisive figure than his mother, King Charles is likely to bring renewed energy to those who question the relevance of a royal family at a difficult time for the public.

Laura Clancy, author of “Running a Family Business: How the Monarchy Manages Our Image and Money,” says King Charles, has transformed the once sleepy royal accounts. .

“The principality has been steadily commercialized over the past few decades,” Ms. Clancy said. “It’s run like a commercial enterprise with one CEO and over 150 employees.” What was once considered an “aristocrat’s heap of land” now functions as a corporation, she said.

The Principality of Cornwall was founded in the 14th century as a way to generate income for the heir to the throne and essentially funded Charles’s private and official expenses. An example of its financial strength: The $28 million profit he made from it last year was less than his official salary as a prince, just over $1.1 million .

Pooling the royal family’s assets together is complicated, but assets are generally divided into four groups.

The first, and most prominent, is the Crown Estate, which oversees the assets of the monarchy through a board of trustees. Charles, as king, will serve as its chairman, but he has no final say on how the business is managed.

The property, which has an official account of more than $19 billion, includes shopping centres, busy streets in London’s West End and, increasingly, wind farms. , as they do not own personal property.

The profits of the estate, worth about $363 million this year, go to the Treasury, in return for which the royal family is paid so-called sovereign allowances based on those profits – this amount must be supplemented by the government if it is lower than the previous year. In 2017, the government increased the family’s payment to 25% of profits to cover the cost of renovating Buckingham Palace.

The latest sovereign grant the royal has received is around $100 million, which the family, including Charles, have used for official royal duties, such as visits, paychecks and house keeping . It does not include royal security costs, which are also covered by the government, but are kept secret.

The next big pot of money is the Duchy of Lancaster. This $949 million portfolio is owned by whoever sits on the throne.

But the value of that trust is dwarfed by the Principality of Cornwall, the third most important home for royal money, where Charles has long been a prince. Generating tens of millions of dollars a year, the principality funded its personal and official spending, and also banked William, the heir to the throne, and Kate, William’s wife.

It did so without paying corporation tax as most UK businesses are obligated and without publishing details of where the estate invested its money.

“When Charles came to power at the age of 21, the principality was not in good financial shape,” said Marlene Koenig, a royal expert and writer, citing poor governance and lack of diversification. Charles took a more active role in the portfolio in the 1980s and began to hire experienced managers.

“It was at that point that the principality became financially aggressive,” she said.

In 2017, leaked financials document called Paradise Papers revealed that Charles’ principal estate had invested millions of dollars in foreign companies, including a Bermuda-registered business run by one of his closest friends.

The last, and most secret, source of money was the private property of the family. According to the Rich List, the annual catalog of British wealth is published in Sunday TimesThe Queen has a net worth of about $430 million. That includes her personal possessions, such as Balmoral Castle and the Sandringham Estate, which she inherited from her father. Much of her personal fortune has been kept private.

King Charles has also made financial headlines that have nothing to do with his wealth but with the charity he presides over and operates in his name. His control of the platform has been affected by controversy, most recently this spring, when Sunday Times reported that Charles accepted 3 million euros in cash – including money stuffed in shopping bags and suitcases – from a former prime minister of Qatar, Sheikh Hamad bin Jassim bin Jaber al-Thani.

The money goes to his foundation, which funds charities around the world. Charles does not benefit financially from such contributions.

Norman Baker, a former government minister and author of the book, said: “Is he really willing to take money from anyone without questioning whether it is wise? Things The Royal Family Doesn’t Want You To Know. “

Mr. Baker described Charles as the most forward-thinking, caring member of the royal family. However, he said he had also filed a police complaint accusing him of improperly selling honorary titles.

“That’s not royal manners,” he said, referring to a ongoing scandal about whether Charles would give chivalry and citizenship to a Saudi businessman in exchange for donations to one of Charles’ charitable projects.

Charles denied knowing about this, one of his top aides who was involved resigned, and authorities began an investigation. Representatives for the king did not respond to a message seeking comment.

Charles has also been controversial with his outspoken views and campaigning. He lobbied senior government ministers, including Tony Blair, through dozens of letters on issues ranging from the Iraq war to alternative therapies. Although British law does not require it, royal protocol requires political neutrality.

In his inaugural address on Saturday, the king said he plans to back off his outside efforts. “I will no longer be able to devote much of my time and energy to charities and issues that I deeply care about,” he said.

Ms. Clancy, the author, said the new king would, in theory, give up his business and lobbying activities altogether.

“Whether that gets resolved is another question,” she said.

Sarah Hurtes contribution report from Brussels.

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